For anyone who miraculously managed to avoid the budget media circus yesterday (including our previous post) the main highlights yesterday were: The failure to meet economic targets, turning all schools into academies and taxing sugary foods, but, amidst all the over-reporting and endless analysis there were a few employment law tidbits that may have missed your attention. As such here is another piece about the budget to explain the changes.
1. Grand parental leave
Shared Parental Leave is to be extended to grandparents by 2018. The first consultation for the implementation of this policy will be published in May 2016. How this will impact relatives currently using flexi-time requests for such arrangements is currently unknown.
2. Tax thresholds
From 2017, the personal tax threshold will rise to £11,500 and the 40% tax threshold will increase to £45,000. From 2018, anyone who is self-employed won’t have to pay Class 2 National Insurance contributions.
3. Termination payments
Many had predicted that the first £30,000 tax free status of termination payments would be altered or scrapped, however, the £30k limit has survived. The main change to termination payments is that from 2018, termination payments over £30,000 will be subject to employer NICs.
4. Minimum wage rates
Whilst not strictly part of the budget, the Prime Minister recently announced NMW rates for October 2016:
Apprentices under 19 – £3.40
Under 18s – £4.00
18-20 year olds – £5.55
21-24 year olds – £6.95
Also do not forget that from 1st April the National Living Wage of £7.20 will be introduced for over 25s.
To sum up the only real surprise from the budget, in terms of employment law, was that the £30k tax free status of termination payments survived.
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